Reduction of Capital (Section 100)

The duties of the auditor in this regard are following :

  1.  Verifying that the meeting of the shareholder held to pass the special resolution was properly convened; also that the proposal was circularised in advance among the members.
  2.  Confirming that the Articles of Association authorise reduction of capital.
  3.  Examining the order of the Tribunal confirming the reduction and seeing that a copy of the order and the minutes have been registered and filed with the Registrar of Companies.
  4.  Inspecting the Registrar’s Certificate as regards reduction of capital.
  5. Vouching the journal entries recorded to reduce the capital and to write down the assets by reference to the resolution of shareholders and other documentary evidence; also seeing that the requirements of Schedule VI, Part I, have been complied with.
  6.  Confirming that the revaluation of assets have been properly disclosed in the Balance Sheet.
  7.  Verifying the adjustment made in the members’ accounts in the Register of Members and confirming that either the paid up amount shown on the old share certificates have been altered or new certificates have been issued in lieu of the old, and the old ones have been cancelled.
  8.  Confirming that the words “and reduced”, if required by the order of the Tribunal, have been added to the name of the company in the Balance Sheet.
  9.  Verifying that the Memorandum of Association of the company has been suitably altered.
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